David Ebersman, Facebook’s chief financial officer, made the decision to increase the number of shares that would be sold in Facebook’s IPO three days before the big event. The Wall Street Journal suggests this decision doomed Facebook’s shares.

By increasing the amount of shares being sold in the offering and boosting the IPO price to $38, Ebersman was maximizing the amount of money his company, Facebook, would raise by selling its most valuable asset—its stock. But Ebersman was also doing something else. A huge chunk of the expanded part of the offering included shares being sold by principal shareholders, big investment firms like Goldman Sachs that had invested in Facebook prior to the IPO. Facebook would not receive the rich proceeds from the sale of those extra shares.

The question is, why would Ebersman want to help these investment firms sell so much more of their Facebook stock? In the case of Goldman Sachs, for example, Ebersman increased the amount of Facebook stock the bank could sell from 13.2 million shares to 28.7 million shares. DST Group was allowed to sell 45.7 million shares instead of 26.3 million. Ebersman’s investment bankers at Morgan Stanley might have assured him there was enough investor demand to sop up the extra shares, however, Ebersman must have known he was taking a bit of a risk with this last-minute decision.

There is only one plausible answer that explains Ebersman’s decision. He was trying to manage the future stampede to the exits he is expecting from Facebook’s existing shareholders. He wasn’t taking on that risk as a thank you to Goldman Sachs. Ebersman must have been trying to start reducing the number of shares that will be sold into the market later this year once more than 1 billion of Facebook shares belonging to employees, ex-employees and early investors are free from lock-up provisions.

Ebersman was dealing with an unprecedented problem. Facebook had resisted going public much longer than other super hot tech companies like Amazon or even Google. In its effort to find a way to remain a private company and not violate Securities & Exchange Commission rules that require companies with 500 individual investors to file financial statements, Facebook created unconventional restricted stock units to compensate its employees instead of using customary stock options. It brokered deals between early employees seeking to cash out their shares and big private equity and hedge fund investors. This went on for years as Facebook’s valuation grew exponentially and Facebook shares helped create robust marketplaces for private company stock involving accredited investors.

With so many shareholders and the pent up demand from shareholders to cash out their hugely rich Facebook stock, however, Facebook could no longer continue operating in this alternate universe and needed to conduct the IPO Mark Zuckerberg had long resisted in 2012. Well before the IPO roadshow, as the Journal has now reported and I have also been told, Ebersman essentially asked Facebook’s big shareholders how many shares they wanted to sell in the IPO. Some of those requests were very big and Ebersman only partially granted their requests. But Ebersman had a good idea what was coming. Later this year, those shareholders like Goldman would be free to sell all their shares in the stock market once the lock-up provisions expired, as would employees and ex-employees who had learned the lesson of the first Internet bubble. There were also serious tax consideration connected to the unorthodox RSUs that would result in the need for employees to sell their stock. When his bankers told him IPO demand was strong, Ebersman probably saw it as an opportunity to reduce the upcoming selling frenzy that would later no doubt put pressure on Facebook’s stock.

Ebersman did not know that Nasdaq would fumble the offering and might not have realized that his decision to expand the offering would spook some IPO investors. When IPO investors ended up with more Facebook stock than they bargained for and saw no IPO pop, they sold—or so the conventional wisdom goes. Facebook’s stock is now down 15% from its offering price, but has rebounded a bit on its fourth trading day.